We have been searching for a way to create a conversation using the API with a new subject without the message being a group message. The problem with a group_conversation is that recipients will see all the other recipients and this could be a FERPA violation in cross-listed courses.
Setting the group_conversation to false reuses an existing private conversation which can be very confusing since the original subject may have nothing to do with the current message.
I was able to send private messages with a new subject by adding "bulk_message": "true" and "group_conversation": "true" to the json body. bulk_message is not documented in the API, so I don't know how reliable this will be in the future. Currently this works for both less than 100 and more than 100 recipients. If the course/group is too large and the call fails, you will also have to use "mode": "async" with the call.